The term “digital wallet” refers to mobile phones, especially smartphones, that store an individual's credentials and utilize wireless technologies such as near field communication (NFC) to carry out financial transactions. For example, the individual's credit card number can be passed to a merchant's terminal wirelessly via NFC.
Geo-fencing refers to a digital wallet payment method utilizing longer range wireless technologies. Payments made using the geo-fencing payment method are referred to as geo-fencing payments. For example, the individual's credit card number can be passed to a merchant's terminal wirelessly when the individual is in proximity (e.g., 100 meters). Geo-fencing enables consumers to make payment without taking anything out of their pockets or wallets. However, it can be insecure to use this technology to pay because unauthorized users can steal a phone and make fraudulent payments.